Every year, the Swiss federal, cantonal and municipal administrations purchase goods and services worth CHF 40 billion Swiss francs (roughly €34 bn or $41 bn): uniforms for the armed forces, computers for the cantonal administration, or curbstones for the village square. A total of 40 billion Swiss francs is paid to thousands of suppliers and contractors in Switzerland and abroad. But people work under precarious conditions in many developing countries. Ever since the collapse of the Rana Plaza garment factory building in Bangladesh in April 2013‚ if not before, the general public has been aware of the deficient occupational health and safety measures in many developing and newly industrialized countries.
Public authorities to assume consumer responsibility
Nevertheless, the public authorities continue to disregard their social responsibility as large-scale consumers. To be sure, there are plenty of municipalities and public offices that would like to purchase goods and services according to socially sustainable criteria and to include those criteria in their calls for tender. But because that would put them in a legal gray area, many procurement offices shy away from adding such stipulations.
The Swiss parliament is currently deliberating on a revised federal law on public procurement. Whereas the bill submitted by the Federal Council does take ecological aspects by and large into account, it hardly goes beyond the minimum social standards very narrowly defined by the International Labour Organization (ILO). Nor does the bill stipulate any measures to monitor conformity. As a result, there is still no mention of such vital issues as occupational safety and regular working hours. But because contracts are almost invariably awarded to the cheapest bidder, the Swiss Federal Government ends up favoring precisely those contractors that beat down their prices at the expense of their own employees. This disadvantages all employers who take their social responsibility seriously, whether in Switzerland or abroad.
Public procurement thwarts development efforts
In other words, the Swiss Federal Government is hereby frustrating its own development cooperation efforts to promote better working conditions and sustainable supply chains in developing and newly industrialized countries. It makes no sense to award million-dollar contracts to companies in developing and newly industrialized countries that show no regard for their workers’ health and pay them subsistence wages at best.
Consequently, as a member of the Swiss Public Procurement Coalition of NGOs (along with Bread for All, Lenten Fund, Max Havelaar, Public Eye, Solidar Suisse, Swiss Fair Trade), Helvetas is urging the Federal Assembly to adopt the inclusion of social sustainability criteria into the new Federal Law on Public Procurement.